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Recession Would Work in Democrats’ Favor

By The New York Times February 9, 2008 2:12 pmFebruary 9, 2008 2:12 pm

In his Web column today, Tom Redburn writes that even if the economy skirts a formal recession and only undergoes a more modest slowdown before rebounding later this year, voters are likely to blame the weak economy mostly on the Republicans, who are all but certain to be led in November by Senator John McCain. It doesn’t make much difference that President Bush will not be on the ballot. Go to column

McCain’s solution to economic trouble is more tax cuts. This is goofy.

Keynes and FDR demonstrated that the way out of a recession is government spending. Government demand is insensitive to downturns, and government initiatives can create jobs when the private sector is having trouble doing so. Since McCain won’t even consider this option, the Democratic party is our only hope to make it out of this.

One unfortunate reality of elections is how they are, or can be, skewed by short term events or perceptions. The economy is what it is and this dip is not relevant, one way or the other, to the presidential election.

Similarly, a perception that someone is winning can also lead to increased votes for that person. Clinton is currently trying to play that angle very disingenuously concerning dlegate counts. It seems the Times is aiding in that.

I would ask the times to report delegates as follows: Proportional counts for each candidate based on each state. Leave the “superdelegates” out of the election counts. Lit the superdelegits” as uncommitted, since that is what they are, by definition. Same with MI and FL delegates. That would show how the candidates are doing in the primary and caucus process. The superdelegate and the MI and FL delegates, will be determined in the convention.

This method of counting will provide us, the reader, with accurate feedback about the support the candidates are getting, or not getting, from the people in the partyu who are participating in the primaries or caucuses.

Lets ensure the party honchos who are super delegates remain, as they are deined, uncommitted, the voters have finished.

Fascinating but I think it’s the fact that the people will have to choose among two very liberal candidates, John McCain on the Republican side and Hillary Clinton or Barack Obama on the Democrat side. With choices like that, the conservatives in our great country are going to stay home because it won’t matter to them who ultimately wins the Presidency. So the choice will be made by the Moderate Independents and the Liberal Democrats. The Indy’s are independent because of their apathy so I think it’s safe to predict that the next President will be a Democrat. Economy, War, Corruption, Health Care or Veteran’s Affairs don’t matter. It’s the people that vote and the motivated voters are more liberal this time.

Mr. Bush has been in office for more than seven years and is to be held accountable for the current downturn because, in spite of what some folks might think, the buck does stop on his desk. Mr. Bush has been arrogant about a lot of things not the least of which is an endless war that need not to have been, and shouldn’t have been fought against a phantom evil. Mr. Bush is against any kind of government oversight and has given important positions in his administration to unqualified sycophants and others who are downright hostile to their offices. Mr. Bush ignored the housing bubble. Mr. Bush has gifted his rich friends at the expense of the American people and the next president can and should make an issue of that. The next president has to announce a new New Deal.
But, nevertheless, the day of reckoning for the middle class is here and the lesson is to learn to live within one’s means and not borrow against some future windfall. I’ve always wondered why people seem to need more bathrooms than bedrooms and more cars than there are adults living in a home. And that weekend in Paris on the credit card…

Who else should we blame? The Republicans had six years of riding high in the saddle during GW’s presidency. The last election gave the Democrats a narrow control of the House and a split decision in the Senate. GW has managed to block nearly every proposal by Congress. With the legislative, judicial, and executive branches controlled by Republicans, just who else should be give credit for the current mess?

Clearly, we all need scapegoats, whether it’s the Masons, Mormons, bankers, railroads (19th century), Jews, overseas Chinese, Catholics, multi-national corporations, Spanish, Scots, etc., etc. What we cannot do is to step back from ourselves and ask the following: Who demanded that credit be extended to people who were only marginally able to pay back the loans? Once we get the answer to that question, then things make sense. (Hint: The answer can be found by looking in a mirror.) Part of being an adult consists of accepting responsibility and ceasing to claim “the devil made me do it.” Any adults out there?

I shudder to think what will happen when taxes go up considerably under a Democratic administration. The incentive will just not be there for business and you will see more and more unemployment. The worst thing is to extend uemployment to more than 13 weeks…it will cause huge amount of individuals to waste away their time. Is it fair for 20% of hard working individuals supporting 80% of people who refuse to work…even cleaning streets?

The dilemma posed by this column doesn’t exist. Generally speaking, Democrats don’t want to increase taxes on the middle class–they want to cut taxes on the middle class and let the Bush tax cuts, which were quite firmly focused on the upper class, expire.

The problem is, a majority of the population doesn’t vote on the basis of the economy. It votes on the basis of broad ideological (and largely religious) motives. We see the same kind of problem in other cultural contexts as well. For example, the baseless and unscientific nature of various sensationalist claims being disseminated by major media outlets including the National Geographic and Discovery channels has been fully exposed, but the outlets will continue disseminating those claims, because they know a massive portion of the population is fascinated by those claims for ideological reasons. See this article for details:

How does a “formal” recession differ from an “informal” recession? I only know that many people are losing their homes; many more can not afford necessary medical help, our infrastructure is falling apart, deserving students can’t afford to go to college, etc. etc. The unnecessary war in Iraq has cost our economy hundreds of billions of dollars and, even under the best scenario, will cost a trillion before it is over. Sen. McCain’s solution is to continue the war in Iraq ( up to “100 years” if necessary) paid for with taxpayer’s dollars, while telling those same taxpayers there is not enough money to pay for national health care for them. The establishment is completely out of touch with the electorate and with reality.

Recessions are part of the business cycle. That’s a dirty secret that all those kids who never took a basic economics course find out about the hard way. They can be minimized if the government and business leaders are willing to rein in greed and tamp down what Greenspan (who, it must be said, was blind to the conditions creating the current recession) termed “irrational exuberance.” Except in a few cities with very limited available real estate and very high demand for expensive housing–San Francisco, Manhattan and select parts of other boroughs in NYC–the flip-today-worry-about-the-real-costs-of-ownership-tomorrow approach to housing was never going to be sustaintable. We knew that because real estate is also notoriously cyclical–booms are always followed by busts. That’s why pretty much everyone who really understands home ownership argues that no one should ever treat their home as an investment first. It’s a place to live.
None of these candidates really saw this coming. Some, to their credit, tried to move against predatory lending practices and the use of housing as de facto cash machines, but I don’t recall any politician at the national level militating long and hard against the packaging of questionable mortgages into complex securities and all the questionable financial wheeling and dealing that went along with it. Now they’ll try to pump cash back into the economy, and that’s fine. But will memories be long enoguh to prevent this level of pain to happen again? I doubt it.

What incentive are you talking about? Are you suggesting that people will not be motivated to look for jobs and businesses will not be motivated to seek out new income because taxes are higher?

I think you’re exactly wrong. a) Republicans are just as responsible for any coming tax increases; they drew up huge deficits while irresponsibly cutting taxes, and b) I want to see your evidence that higher tax rates cause people to lose the motivation to work. In the 1960’s, the top marginal tax rate as 91% but our economy hummed along quite nicely. I certainly don’t want to see rates like that again, but I think it puts a big dent in the Republican talking point that high taxes remove the incentive to succeed.

McCain’s solution to economic trouble is more tax cuts. This is goofy. #2

It may sound goofy, but it certainly wins elections. I like lower taxes. I get no valuable services. Unless that changes, I am adamantly opposed to higher taxes.

Can the Democrats deliver valuable services so that I know I am getting worthwhile services? Can the Democrats show that government makes a positive difference in people’s lives? The FDR Democrats did make positive change, but they are no more.

Clinton is my preference. Obama’s “hope” campaign is baloney. His lack of voting or voting present does not cut the mustard. If Clinton is not the Democratic nominee, I am voting for McCain.

Of course the Republicans will be blamed and rightly so!It was on their watch especially when they controlled both Houses of Congress that we got into this economic mess of jobs being outsourced overseas,tax breaks for the rich,the Middle Class being reduced etc.

The Conservatives (Repulicans) should be blamed for the lousy economy — the lousy economy of the past 30 years. The most effective Democratic politician will affix this blame to them, which is well and truly deserved.

If it’s the economy stupid, then American political history since Watergate revolves around efforts to restore the dynamic growth of the post-war era. The Conservative solution — slash taxes, de-regulate, run huge deficits — is a total failure. At the heart of this failure is a wilful misunderstanding of the problem: an age of accelerating globalization, technological change an and ecological crisis demands more and new kinds of public investment. The cavalier and contemptuous attitude of Conservatism towards government, especially public investment in infrastructure, education, job training and research, is the equivalent of bleeding the patient to cure a fever. It provides temporary relief followed by rapid death.

Bush has demonstrated this in a way that anyone can see with a little reflection. It is up to Democrats to get this across to the public once and for all and send late twentieth-century “Conservatism to the same political graveyard as mid-twentieth century “Liberalism.” Our time for change has come. We need a name for it though.

The central question is not which candidate will become the president. But, whether that person will be able to turn the economy around despite difficulties in foreign policy; (Iraq, Iran, Afghanistan). Moreover, it will require the president to raise taxes and cut government spending (defense programs related to Iraq and Afghanistan) to encourage and upward flow of currency into the econmy which would bring inflation down. The president, I believe, will need a contractionary fiscal policy to calm Wall Street fears and bring the deficit down as applied by the Clinton administration in the 1990’s.

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